Sunday, April 8, 2007

Urban Poverty and Inequality in Jakarta

The picture was taken by John Kots in June 2006 and his comment on this picture was as follows:

This struck me as typical Jakarta: modern towers amidst great poverty. The contrast between rich and poor is very pronounced in this very interesting megalopolis.
The picture reveals two different worlds that take place in one location. Despite a robust economic growth, Jakarta is still a place of poverty. There is no doubt that that poverty is an intractable problem in Indonesia. War on poverty has been initiated long way back since the New Order regime. A variety of alleviation programs have been implemented, but the way to prosperity is still a long way to go. Not to mention rural poverty, the poverty in Indonesia's urban areas has been a problem for many years.

Another picture is presented below to clearly illustrate the extent of poverty of a neighborhood in the river bank in Jakarta. The picture was taken by Muhammad Husni Thamrin on November 2003 showing a very poor neighborhood on the river bank of Ciliwung in the subdistrict of Manggarai, Central Jakarta. This kind of neighborhood was also blamed as the culprit of the recent floods in Jakarta.

Indonesia until the 1997 Asian financial crisis is one of remarkable economic success, one that has captured the attention of many experts and policy makers. From a steep recession in 1965 (8 percent decline in GDP), the country’s economic development took off in the seventies, earning tremendous windfalls benefits from oil shock. This bonanza development carried over throughout the eighties and into the nineties despite the oil counter-shocks. From 1985 through 1995, the GDP rose at an average rate of 7.1%.

In line with Indonesia's economic growth, the percentage of urban population living under poverty line decreased significantly from 38.8% in 1976 to 9.7% in 1996. The number of urban population living under line poverty decreased from 10.0 million in 1976 to 7.2 million in 1996. However, when the economic crisis struck Indonesia since mid 1997 the number of urban population living under poverty line in 1998 increased sharply to 17.6 million or 21.9% of the total urban population. The poverty line was determined by the expenditure needed to meet the minimum cost of living. It varies by year and location. These poverty lines are still less than the poverty line determined by the World Bank which is $2.00 a day.

In order to recover from the economic crisis, a variety of urban alleviation programs were implemented including social safety net program. These programs have been able to reduce the number of poor people in Indonesia. The number of urban population living under poverty line in 2005 decreased to 12.4 million or 11.4% of the total urban population. The proportion of urban poor in 2005 decreased but the number of urban poor in 2005 is still more than that in 1976. The influx of rural poor who moved to urban areas contributes to the increasing number of urban poor in Indonesia.

In 2002 there were 286,900 poor people in Jakarta and it accounted for 3.4 per cent of the population of Jakarta. It is the least proportion of poor population among other provinces in Indonesia. The proportion of poor population in Indonesia in 2002 was 18.2 per cent. The highest proportion of poor population was in Papua (41.8 per cent). The robust economic growth of Indonesia has mostly benefited the resident of Jakarta including urban poor. Other areas in Indonesia still have high proportion of poor population. The economic growth has less impact on poor people in other regions of Indonesia. It is just another saddening evidence of how the dominance of Jakarta costs other regions of Indonesia.


Anonymous said...

Needed effort from government to reduce the poverty. Well it is only about the economic side itself or it impact / responsibilty Indonesia government of taking "pure" democrazy?

Anonymous said...

I stumbled upon your website while trying to find information about Indonesia's economy.

I initially became interested in this subject after moving to Jakarta. In light of Suharto's recent passing and the press bestowing him with great honors such as "abolishing abject poverty" or "having an economy the envy of Asia" I wanted to get a little more of the truth.

I don't find that Indonesia, specifically Jakarta is that developed. From the Indonesians with whom I've spoken, it seems that education has not advanced, middle class has not grown, and the general economy has not been sufficiently developed.

I don't believe that the Indonesian government takes poverty very seriously. Their own stated threshold for poverty is somewhere along the lines of $18 per month. Is that correct? I have found that the average worker makes roughly $130 per month to raise a family of four. This doesn't seem to have risen since Suharto's ascention to power, so what is the real story of Indonesia?

The first thing that took me was the abject poverty in direct view of massive construction projects (where workers live in hovels and make about $2 per day) much like the picture on your site.

When compared with Indonesia's neighbors Singapore and Malaysia, what is Indonesia's story?


Gunawan said...

Hola Pak Deden

Firstly thank you for your blog about Indonesia's Urban Study, since it is hard to find such those information.
secondly, now I am studying Urban Management in Berlin University of Technology since 24 October 2011.
I am a new comer for urban study, and I should do a paper work about Jakarta Profile. I search some information from internet regarding database of jakarta for example map of city sprawl, land tenure, spatial planning, housing back log, etc, but it's hard to find that data
I got Jakarta Dalam Angka 2010 but not say much.
Could you give me information where to get the urban data base of Jakarta ?
Also I would like to write about Jakarta Urban Poverty, but in the statistic it said that the poverty is only about 300,000 in Jakarta. Is it true ? since I travel alot in Jakarta and I saw a lot of slums and poor community ?

Thank you in advance for your support
Berlin, 18 November 2011